Question:
( 1 of 10 ) Find the amount to be paid if Joseph borrowed a sum of $5700 at 3% simple interest for 7 years.
(A) 59
(B) 30.5
(C) 61
(D) 60
You selected
$5700
Correct Answer
$6897
Solution And Explanation
Solution
Given,
Principal (P) = $5700
Rate of Simple Interest (SI) = 3%
Time (t) = 7 years
Thus, Amount (A) = ?
The Rate of Interest is always calculated per annum, i.e. per year.
Thus, here 3% simple interest means, Rate of Simple Interest (SI) is 3% per annum.
Method (1) Using Formula
Calculation of Simple Interest
Formula to Calculate Simple Interest
Simple Interest (SI) = Principal × Rate × Time
Thus, Simple Interest (SI) = $5700 × 3% × 7
= $5700 ×3/100 × 7
= 5700 × 3 × 7/100
= 17100 × 7/100
= 119700/100
= $1197
Thus, Simple Interest = $1197
Calculation of Amount
The total money paid to the lender by a borrower is called the Amount.
In other words, sum of priciple and interest is called the Amount.
Formula to Calculate the Amount
Amount = Principal + Interest
Thus, Amount = $5700 + $1197
= $6897
Thus, Amount to be paid = $6897 Answer
Method (2)
Calculation of Amount when Principal, Rate of Simple Interest and Time are given
Calculation of Amount directly using Principal, SI, and Time
Formula to calculate the Amount
Amount (A) = Principal (P) + Principal(P) × Rate of Interest (SI) × Time (t)
⇒ A = P + PRT
Here in the question, P = $5700
Rate of Simple Interest (SI) or (R) = 3%
And, Time (t) = 7 years
Thus, Amount (A)
= $5700 + ($5700 × 3% × 7)
= $5700 + ($5700 ×3/100 × 7)
= $5700 + (5700 × 3 × 7/100)
= $5700 + (17100 × 7/100)
= $5700 + (119700/100)
= $5700 + $1197 = $6897
Thus, Amount (A) to be paid = $6897 Answer
Method (3) Unitary Method
Calculation of Amount using Unitary Method
Calculation of Interest using Unitary Method
Here, given Rate of Simple Interest = 3%
This, means, $3 per $100 per year
∵ For $100, the simple interest for 1 year = $3
∴ For $1, the simple interest for 1 year = 3/100
∴ For $5700, the simple interest in 1 year
= 3/100 × 5700
= 3 × 5700/100
= 17100/100 = $171
Thus, simple interest for 1 year = $171
Therefore, simple interest for 7 years
= Simple interest for 1 year × 7
= $171 × 7 = $1197
Thus, Simple Interest (SI) = $1197
Calculation of Amount
Amount = Principal + Interest
Thus, Amount = $5700 + $1197
= $6897
Thus, Amount to be paid = $6897 Answer
Similar Questions
(1) Barbara had to pay $3869.5 in order to furnish the loan taken 3 years before. If the rate of simple interest was 3% then find the sum borrowed.
(2) Linda had to pay $3551 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.
(3) Margaret took a loan of $6700 at the rate of 9% simple interest per annum. If he paid an amount of $10921 to clear the loan, then find the time period of the loan.
(4) David took a loan of $4800 at the rate of 7% simple interest per annum. If he paid an amount of $7152 to clear the loan, then find the time period of the loan.
(5) Michael took a loan of $4600 at the rate of 7% simple interest per annum. If he paid an amount of $7820 to clear the loan, then find the time period of the loan.
(6) Calculate the amount due if John borrowed a sum of $3200 at 10% simple interest for 3 years.
(7) Betty had to pay $4505 in order to furnish the loan taken 3 years before. If the rate of simple interest was 2% then find the sum borrowed.
(8) What amount will be due after 2 years if Kenneth borrowed a sum of $4000 at a 9% simple interest?
(9) If Patricia borrowed $3150 from a bank at a rate of 2% simple interest per annum then find the amount to be paid after 2 years.
(10) Elizabeth took a loan of $4900 at the rate of 7% simple interest per annum. If he paid an amount of $8330 to clear the loan, then find the time period of the loan.